This would have been better if it wasn't pro-McCain. McCain is part of the problem too. How much money is the never-ending war on terror going to cost taxpayers?

I was watching this video waiting for a reason not to upvote, but I didn't see a single inaccurate statement in there that could be refuted: save for one: "Change is on the Ballot."

I could also do without the pro-McCain slides, but it doesn't change the fact that what is presented is the precise reason for the housing market crash.

Upvoting this because I agree that this is the primary cause for the subprime crisis.

It is ironic that people are proposing more regulation to correct this.

It seems to me, however, that this video tries to place blame in a very skewed way, especially given this comment from the CRA wikipedia article:

"In 2003, the Bush Administration recommended what the NY Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." [10] This change was to move governmental supervision of two of the primary agents guaranteeing subprime loans, Fannie Mae and Freddie Mac under a new agency created within the Department of the Treasury."

Isn't this exactly what the bill is going to achieve, along with a ton of other affected lenders?

The 2003 act didn't pass because there was no crisis then, so where does that leave us? Is it possible that the Bush administration knew what was going on from the outset, or did they have other intentions? Why would a pro "free market" republican administration want to regulate mortgage lenders in the first place?

This problem was not caused by borrowers.

It was caused by predatory lenders and corrupt rating analysts.

This mess we're in - 100% of it - is due to the Bush administration and its supporters who unthinkingly treat the "free market" as if it were their God.

^This was government intervention through and through. The CRA set it up, and the federal reserve knocked it down.

"1. The Federal Reserve cut interest rates to as low as 1% (from 6%) so that after inflation we had negative interest rates.
2. As a result, mortgage rates fell to an all time low.(8% to 5%)
3. Low rates caused borrowing and lending to explode, particularly in real estate. For example, commercial banks more than doubled the amount of real-estate loans they made. ($1000 billion to $4000 billion)
4. All these low interest loans had to be extended to people with worse credit ratings and this increased the demand for homes and other real-estate assets. It should not be surprising that home prices skyrocketed"

source: http://mises.org/story/3130

@ roughy: unthinkingly treat the "free market" as if it were their God.


If more were left up to the scrutiny of the free market, we wouldn't be in this mess. No 100% free market bank would've purchased all those bad loans. Ideally, they would have had the best interest of their stake holders in mind. The Sub-Prime loan boom was in play before Bush took office. He didn't help, but it doesn't get us anywhere to place all the blame on him. If you think the Bush administration holds all the blame, then you're just the kind of person that would allow this to happen again- right under your nose.

It's important to understand what really happened so that it doesn't happen again. Uncross your eyes.

http://www.huffingtonpost.com/hale-stewart/whos-to-blame-for-the-mes_b_130044.html

Hale Stewart's bio: Hale "Bonddad" Stewart is a former bond broker with several regional firms. He has been involved with the financial markets since 1995. He is a graduate of the Thomas Jefferson School of Law's LLM program with a dual concentration in international and domestic taxation. He currently practices tax law in Houston, Texas.

It's really too bad people on this site refuse to listen to the truth and would much rather listen to Obama propaganda.

In my opinion, anyone in a position of power who is knowledgeable about economics, and tries to blame this on anything aside from the CRA or the federal reserve should be charged with fraud and sent to jail for a LONG time.

1. greenspan
2. paulson
3. bernake

come to mind.

And NetRunner, 3 out of 5 of the authors conclusions are complete nonsense. (2,3, and 5). This was CRA+federal reserve and theres just no way around it. His credientials as a tax lawyer say nothing about his credibility as an economists. Sh*t most economists credentials as economists say nothing about their credibility as an economist--why do you think we are in this mess!

Members of the Austrian school of economics have been screaming about this crash for the last 30+ years!

Ha this is just laughable.

This video takes a small part of this problem and magnifies it to blaming it on the Federal government. Thus taking any blame away from Wall Street as a whole.

It fails to mention the decreased standards of credit checks used by Banks and other financial institutions that were backing these mortgages because they were following the housing bubble.

It fails to mention how these mortgages were then repackaged in various forms and sold out back to other financial entities, spreading out the risk in various forms leading to the obscurity of where the all toxic debt is.

I could go on but this is really like saying the Asian crash was caused because too many people built shit.

And please this video is bipartisan? Have you seen this guys channel? Its all Pro-McCain and Anti-Obama, and claims that Sarah Palin is actually qualified. Am okay with the former but the latter makes him lose any credibility with me.

^I said that this video was one-sided. I thought that would lead you to believe that I thought that this video was one-sided.

Decreased Standards of Credit Checks = Fannie Mae and Freddie Mac eased their requirements and started buying loans with less strict underwriting. Primary lenders started selling whatever Fannie and Freddie would guarantee. Why wouldn't they?

Housing Bubble = People who couldn't afford homes were buying them because Fannie and Freddie let them, thus rapidly inflating the price of homes. Simple supply and demand.

Loans repackaged in various forms? You think Fannie, Freddie, and the Fed were fooled? They knew what was going on all along. Those other financial entities were just along to ride the wave that Fannie and Freddie started.

Refresh my memory: What percentage of residential (1-4 unit) loans did Fannie and Freddie back? Nobody else comes close to having any influence over the secondary mortgage market like they do. What they decide, the rest must follow -or fail.

I agree Farhad. I posted something from this guy's channel this morning. He's clearly campaigning for McCain.

If this proves anything for me personally about my feelings for Obama, its that I don't trust his financial adviser.

I feel pretty disillusioned in general with all involved. Anyone have any unbiased truth to share this morning?

The Community Reinvestment Act was a mandate to lower standards and opened up banks to corruption.

I remember ARM loans were being handed left and right. Poor devils should have re-financed in two years. We had one once. You're lured into those lower prices at first.

I'm soooo grateful we changed to a fixed loan.

The fact that Fannie Mae and Freddie Mac could cook the books enough to get those HUGE bonuses says they knew all along there would be a crash. They were getting what they could out of it first.

Why aren't they up for criminal charges? Hmmm?

http://www.videosift.com/video/In-Their-Own-Words-Dems-Scam-Coverup-Caused-Crisis

Moving this video to deedub81's personal queue. It failed to receive enough votes to get sifted up to the front page within 2 days.

*beg

Sending this video to Beggar's Canyon to plea for a little attention - beg requested by original submitter deedub81.

still *begging

Sending this video to Beggar's Canyon to plea for a little attention - beg requested by original submitter deedub81.

*lies

Adding video to channels (Lies) - requested by MrFisk.

*promote

Promoting this video and sending it back into the queue for one more try; last queued - promote requested by dotdude.

Upvote for the informative part of it, even though the frame/format of it makes it a pain in the ass to watch.

@swampgirl: Why aren't they up for criminal charges? Hmmm?

Eric Janszen so eloquently said in his article The next bubble: Priming the markets for tomorrow's big crash:

Given the current state of our economy, the only thing worse than a new bubble would be its absence.

I beg to differ on the "hard to ignore" bit of the description; I could only get through about half of it before turning it off. I agree with Farhad2000 on the content of the video though. One or my roomates works in the financial industry -- He showed me a Powerpoint presentation called "The Subprime Primer" that explains this mess, and it doesn't exactly agree with this video.

(Full disclosure: I've just sifted a reading of the powerpoint presentation)

>> ^jake:
Upvoting this because I agree that this is the primary cause for the subprime crisis.
It is ironic that people are proposing more regulation to correct this.
It seems to me, however, that this video tries to place blame in a very skewed way, especially given this comment from the CRA wikipedia article:
"In 2003, the Bush Administration recommended what the NY Times called "the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago." [10] This change was to move governmental supervision of two of the primary agents guaranteeing subprime loans, Fannie Mae and Freddie Mac under a new agency created within the Department of the Treasury."
Isn't this exactly what the bill is going to achieve, along with a ton of other affected lenders?
The 2003 act didn't pass because there was no crisis then, so where does that leave us? Is it possible that the Bush administration knew what was going on from the outset, or did they have other intentions? Why would a pro "free market" republican administration want to regulate mortgage lenders in the first place?


I think I see what you're saying. The Bush-proposed agency was just more regulation of the economy? Well, that's true, but what they were attempting to do is regulate the regulations. They wanted to make sure Fannie and Freddie were maintaining some kind of integrity, which they obviously weren't. What they ought to have done is allowed the All-Powerful All-Knowing Free Market to do its thing.

What really chaps my hide is that in the VP debate Biden blamed McCain's deregulation policies for the crisis, and Palin didn't say A WORD to the contrary. Probably because she has no idea how the economy functions.

Why couldn't we have nominated some decent candidates? Does anyone want to hop into my time-machine with me?

You people can't be fucking serious.

When the candidates talk of REGULATIONS they are talking about regulating BANKS and other FINANCIAL INSTITUTIONS so that they don't REPACKAGE toxic debts with AAA debt and SELL OFF TOXIC DEBT PACKAGES to other BANKS and FINANCIAL INSTITUTIONS.

Which is why people still don't know the exact exposure of the US economy to toxic debt.

^If a company wants to buy a debt package with bad loans thrown in, that's their problem.

...as long as there was full disclosure and there aren't any government sponsored organizations involved.

If that's the direction we head with more regulation, I'm all for it. The problem is the white lies and deceit that occurs when good investments, collateral, and loans are packaged together with poor investments in offshore accounts using shell companies that are labeled as "long term" and "safe" investments.

We obviously need to increase consumer protections but when it comes to the financial markets, it starts to get really wordy and many won't pay attention anyway. I digress.

There is never full disclosure mostly because those companies are pitched these packages the same way you get pitched by late night TV that the scrotum massager will revolutionize your life.

These finical instruments were highly complex derivatives that sometimes even those who packaged them didn't really understand their ultimate risk factor, if you think that is unlikely then remember that Enron in it's heyday was selling weather futures.